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Delivery Co. cuts fleet mileage by 25% and achieves major cost and environmental savings with Optrak’s vehicle routing and scheduling software
The Delivery Co. is the UK logistics operating company for the PaperlinX Group providing a dedicated in-house logistics service for its three UK Merchants. The Optrak vehicle routing software has been used on a consolidation and rationalisation project for The Robert Horne Group, The Paper Company and the Howard Smith Paper Group and Delivery Co. has cut the kilometres travelled by the group fleet by 25%.
The Delivery Co. was established in 2006 and was the result of a strategic initiative to identify synergies and benefits from the three companies’ common ownership platform that importantly did not dilute their individual customer value propositions or competitive advantage.
At an early stage in the project, computerised vehicle routing was identified as a key part of the consolidation process to ensure both efficient and fair routing of the daily delivery needs of three competing merchants in a demanding service environment. Delivery Co. has adopted Optrak’s vehicle routing solution for an enterprise wide deployment and in the process adopted best practice, eliminated duplication, and improved overall resource utilisation.
The Robert Horne Group had been successfully using Optrak for 14 years and this experience and the established relationship with Optrak was the perfect base for the Delivery Co. development. Optrak has enabled us to reduce our vehicle fleet size by 10%, make significant cost savings and substantially reduce our impact on the environment. Optrak is an essential element in the regional consolidation process and has been integral to the success of the Delivery Co. operations.”
John Ball, Director, Delivery Co.
Creating a lean distribution operation with Optrak Delivery Co. uses the Optrak software to analyse and determine the most efficient way to organise and rationalise fleet and depot operations in each region that it operates in. This involves looking at different options for the fleet mix and configuration, how many drivers are needed, what shifts they will need to work, etc. Delivery Co. has found that Optrak gives accurate and reliable information on what is needed to meet the company’s delivery requirements. It also shows the potential cost reduction for any given set of customers and orders.
By consolidating the fleet, Delivery Co. has eliminated instances where a customer gets multiple orders on different vehicles. This has proved popular with customers as it minimises the amount of time required to
Dynamic daily routing and scheduling
Customers place orders during the day for next day delivery. Optrak processes all of the available resources (e.g. drivers, vehicle capacity, working hours), order details and customer information (e.g. address, postcode, opening times, vehicle access restrictions) ‘in seconds’ says Wright.
Customers have different time windows and Optrak ensures that the right products are delivered at the right time on the most appropriate vehicle. There tends to be a rush of orders towards the end of the day but Optrak gives Delivery Co. the ability to still meet its next day delivery guarantee by ensuring that the scheduler can create accurate and efficient vehicle routes and loading schedules.
Delivery Co. has a mix of single and double deck vehicles. Optrak intelligently maximises fleet utilisation as it automatically observes weight and volumes restrictions per vehicle. It also ensures that the right vehicle is selected for each order which is necessary as plastic products can only be delivered on a particular vehicle type.
The predicted delivery ETAs created by Optrak are loaded into a Management Server whose web-based technology combines with the mobile data solution developed by the Delivery Co. to provide the sales teams with on-line track and trace capability and proof of delivery. This has the added benefit of cutting down the number of queries the transport department receives.
Consolidation leads to major savings
East Anglia was the first region to be reviewed by Delivery Co. Each of the paper merchants had fleets and warehouses covering this area. Optrak was used to analyse the most efficient way of reorganising the distribution operations, taking into account current and future demand levels and the availability of resources.
Delivery Co. centralised operations into one main site at Ipswich with one satellite operation to serve East Anglia.
“We were able to prove with Optrak that the new operation would lead to significant savings. Consolidation and more efficient routing of deliveries in the region has resulted in the elimination of 10,000 individual deliveries in year one. Additionally, we were able to reduce the combined fleet by 6 vehicles and this made a large reduction in our carbon footprint.”
Douglas Wright, National Operations Manager
Once Optrak is implemented at a particular depot, Delivery Co. is firmly committed to a program of constant improvement. For example, each driver provides feedback on the daily trips and this has been vital in refining how the routing works.
As the three logistics operations evolved, it was clear that manual routing would not achieve the service levels required by the business. Optrak gives us greater accuracy and more consistent reliability which is vital to retaining our customers. It has also eliminated the risks involved in manual routing and improved the visibility of our service levels.”
John Ball, Director Delivery Co.
Delivery Co. and Optrak achieve impressive results
The roll-out of Delivery Co. is a three-year program based on a regional migration process that started in November 2006 and is on schedule to be completed later this year, at which point the Delivery Co. will be responsible for the management of more 1.5m square feet of warehousing, a distribution fleet of more than 400 vehicles completing 5,000 deliveries each day, titling more that 2,000 tonnes of daily delivered product.
Delivery Co. benchmarks a number of KPIs before each Optrak implementation. This has shown a consistent reduction in the vehicle fleet size of at least 10% with resources being redeployed within the organisation. Other savings have also been made through rationalising the number of distribution sites.
The consolidation and optimisation of operations in the UK has also delivered significant environmental benefits. The creation of Delivery Co. has reduced the kilometres travelled by its combined delivery fleet by 25% thereby reducing its CO2 emissions by some 200 tons per year in the East Anglia region alone and it is estimated that the completed national roll-out will achieve a reduction in excess of 2500 tonnes per year.
Ball emphasised, “The consolidation process and the use of dynamic scheduling have had a dramatic impact in reducing not only the number of vehicles used but also the daily kilometres those vehicles travel. Optrak also enables Delivery Co. to achieve a reduction in energy usage which demonstrates our long term commitment to the environment.”
Toby Marchant, CEO PaperlinX Europe adds, “Developing superior strategic alliances is a key goal for the company and our partnership with Optrak has enabled us to generate significant environmental benefits and energy reductions, which was one of the aims of the Delivery Co. when it was established.”
Tim Pigden, Managing Director of Optrak said, “The project at Delivery Co. has established industry best practice standards for operations that need a rapid turnaround from order taking to next day delivery. With the industry focus on green issues, Delivery Co. has shown how to significantly reduce carbon emissions.”
"Optrak has enabled us to reduce our vehicle fleet size by 10%"
Director, Delivery Co.